Beginner Tips on Investing in Bitcoin?

[blackhull]

Learn so much that you can convince yourself not to invest at all. Then maybe you're close to being ready to invest.

it doesnt make sense

I think he means play devil's advocate with oneself.  Learn about all of the potential things that could go wrong.... Government intervention, wallet theft, inflation, competing currencies, and so on.

Exactly. You make money in markets by not losing it. You don't lose it by controlling risk. To control risk, you need to be aware of the knowable risks involved.

[r34tr783tr78]

Why use abstract and vague rules of trading, they are so easy.

1) Identify the main trend, if it's a bearish or bullish one.

2) Trade accordingly, avoiding to trade against it. The trend is your friend.

3) Don't think the price is already very low and that it's time to buy. Prices can always go even lower.

4) Be careful guessing tops and bottoms. If you were wrong, jump out and assume the loss, instead of converting your move on a long-term one. If you insist in keeping them, avoid buying more to lower the median price, that is a recipe for disaster.

5) I know it goes against all the rules you learned on life (it's a violation of the rule of demand, that says that demand lowers when the price goes up), but don't think the price is too high to buy, unless it's clearly temporarily overbought or it was a fake breach of  a resistance. If it's on a bullish trend, the probability that it will keep going up is higher than the opposite. So, many times, buying higher has more sense than buying lower. Ex. I have little doubt that if bitcoin breaches clearly the 1156 top on bitstamp it will keep going up.

6) The rule is not to buy low and sell high. Buying an active on a bearish trend, going lower and lower, is a disaster. If the active is in a bulish trend, the rule can even be buy high and sell higher.

The hard thing isn't to identify the rules, but to follow them!

[keithers]

Depending on how much you plan on investing (as well as the country you live in), you now also have to keep tax ramifications in mind. I believe you can still only claim up to a $3,000 loss against your income, but the taxes on the gains are uncapped. Therefore, you want to plan on holding the BTC for at least a year, so that you can have long term capital gains, instead of short term capital gains. Short term gains are taxed at a higher rate.

If you are only buying a few BTC here and there, you will probably just slide under the radar. But if you have several deposits in your bank that exceed $5,000, you have got to be keeping track of everything so that you don't expose yourself to an audit.

[blackhull]

Why use abstract and vague rules of trading, they are so easy.

1) Identify the main trend, if it's a bearish or bullish one.

2) Trade accordingly, avoiding to trade against it. The trend is your friend.

3) Don't think the price is already very low and that it's time to buy. Prices can always go even lower.

4) Be careful guessing tops and bottoms. If you were wrong, jump out and assume the loss, instead of converting your move on a long-term one. If you insist in keeping them, avoid buying more to lower the median price, that is a recipe for disaster.

5) I know it goes against all the rules you learned on life (it's a violation of the rule of demand, that says that demand lowers when the price goes up), but don't think the price is too high to buy, unless it's clearly temporarily overbought or it was a fake breach of  a resistance. If it's on a bullish trend, the probability that it will keep going up is higher than the opposite. So, many times, buying higher has more sense than buying lower. Ex. I have little doubt that if bitcoin breaches clearly the 1156 top on bitstamp it will keep going up.

6) The rule is not to buy low and sell high. Buying an active on a bearish trend, going lower and lower, is a disaster. If the active is in a bulish trend, the rule can even be buy high and sell higher.

The hard thing isn't to identify the rules, but to follow them!

Though these are generally good trading rules, he asked about investing, not really day trading... with investments things like liquidity concerns make some of those rules somewhat irrelevant.

[r34tr783tr78]

Those rules are not for day trading, the trend you have to identify is a median-term one, of at least some months. Some actives have trends of 1 or 2 years.

[pattimarkow]

I am new to this, but my idea was to just watch the prices on BTC-e or coinbase and buy low (I found usually in the morning and usually on
BTC-e) then sell later in the day (usually higher on coinbase).

Or you can just reap profits by going to experienced traders and just getting the profits:

https://www.mydailycoin.com/index.php?ref=pattimarkow

I'm trying my daily coin because I found it just requires too much patience and time to try to trade or invest
myself.  I was convinced that these guys are experienced traders and know what they are doing.  1% daily isn't
a lot, and you can probably earn more by learning yourself, but this certainly is easier.

Hope this helps a little.

[r34tr783tr78]

Please, avoid using that kind of strategy to invest or day trading.
There isn't a pattern of buying low in the morning and sell higher on the evening or, at most, that pattern only works out on a bullish trend. On a bearish trend (when prices are declining), you will buy high in the morning and sell lower in the night.
I know it's boring to have to read a lot about trading, but, believe me, learning buy your self will be the most costly lessons of your life.
In the middle time, check tradingview.com and see the charts users post and follow the chat on bitcoin.

[Este Nuno]

Honestly...Just buy and hold. No mining. No daytrading. Just read bitcointalk to see how many people have been burned.

But no one has been burned just buying and holding bitcoin over any reasonable amount of time.

[blackhull]

ITT: everybody talking their own book

[Benjig]

Buy and hold, forget about your coins for a time, you wont wanna regret of shorting them just before a rally

[r34tr783tr78]

Everyone has to decide for himself, however, think about those that applied the policy of buy and hold by buying bitcoin at 1200 or litecoin at 50 usd.

In the long term, it's going "to da moon". Maybe, but we never can be shore.

Besides, holding them to the abysm, like crashing bellow 300, means that when bitcoin finally stop going down you won't have the guts to buy more.

[lyth0s]

In addition to my previous advice. Buy bitcoin and do now before the next price increase. When July/August come around the corner and bitcoin is multiples of what it is now you will be kicking yourself for not getting in earlier. Also if you accidentally buy at a peak and then the price drops, just HOLD. Use this bitcoin price graph (or any similar graph), buy when your below the trendline, sell when your above.

[bitbillion]

When investing use the 3 L rule
laugh laugh laugh

if you see a alt coin where the price makes you smile buy in

only invest as much even if the coin drops so you can still laugh

and sell the coin when you can laugh about your profit

and read the charts, read the charts Numbers dnt lie

everyone else is

[Bit_Happy]

Why use abstract and vague rules of trading, they are so easy.

1) Identify the main trend, if it's a bearish or bullish one.

2) Trade accordingly, avoiding to trade against it. The trend is your friend.

3) Don't think the price is already very low and that it's time to buy. Prices can always go even lower.

4) Be careful guessing tops and bottoms. If you were wrong, jump out and assume the loss, instead of converting your move on a long-term one. If you insist in keeping them, avoid buying more to lower the median price, that is a recipe for disaster.

5) I know it goes against all the rules you learned on life (it's a violation of the rule of demand, that says that demand lowers when the price goes up), but don't think the price is too high to buy, unless it's clearly temporarily overbought or it was a fake breach of  a resistance. If it's on a bullish trend, the probability that it will keep going up is higher than the opposite. So, many times, buying higher has more sense than buying lower. Ex. I have little doubt that if bitcoin breaches clearly the 1156 top on bitstamp it will keep going up.

6) The rule is not to buy low and sell high. Buying an active on a bearish trend, going lower and lower, is a disaster. If the active is in a bulish trend, the rule can even be buy high and sell higher.

The hard thing isn't to identify the rules, but to follow them!

I don't mean to be blunt and rude, but thank you for teaching the newbies how to lose.  
Some of your advice is solid, but part of it helps good traders make a living off of people who actually believe "that stuff".

A) Fact: Most traders lose money long term
B) If you carefully follow all 6 steps quoted above, then you are well on your way to donating money to the winners.

You claim that buying while prices are falling is a "recipe for disaster" and tell people "many times, buying higher has more sense than buying lower"...that is beautiful. Keep up the great work.
ps. I admit having trouble catching huge moves, but I've done really well buying during Bear markets and trading my way into good % gains. (often even before the trend 'officially' reverses)

Edit: If "the rules" work for you, then that's great, hopefully others might benefit also.
There are many different styles of trading and some work well only under ideal market conditions.